Arthur I. Cyr: Difficult Japan-U.S. trade negotiations begin

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Tuesday

Aug 7, 2018 at 9:55 AMAug 7, 2018 at 9:55 AM

Trade negotiations between the governments of the United States and Japan will begin Aug. 9. Analysts expect Robert Lighthizer, the top U.S. trade negotiator, to press for a new bilateral trade agreement between these economic great powers. Japan’s government prefers to operate within the status quo, meaning established multilateral forums and agreements.

Approximately one year ago, Japan Prime Minister Shinzo Abe visited the United States. The events involved underscored the vital importance of the alliance between our two nations. Military defense as well as economics is involved. Growing nationalism is evident in Japan, and reflected in the prime minister’s own public statements, but there is no wide support for any massive change in defense posture.

The ministerial meeting of ASEAN (Association of Southeast Asian Nations) in Singapore provides a timely opportunity to underscore the continuing importance of multilateral organizations. U.S. Secretary of State Mike Pompeo emphasized this in opening remarks on Aug. 3.

Pompeo and North Korea Foreign Minister Ri Yong Ho traded pleasantries at the conference. The return of remains of Korean War dead to the U.S. may ultimately prove to be an especially important positive gesture, which could generate continuing practical humanitarian cooperation and improved relations.

Several years ago, Japan-U.S. trade negotiations seemed to be nearing success and then stalled. In 2014, hopes were disappointed that negotiations would succeed before a trip by President Barack Obama to Japan. There was frustration an accord failed to materialize in time for Prime Minister Abe’s trip to the United States during April 26-May 3, 2015. Nonetheless, discussion with President Obama was useful, along with an address to a joint session of Congress.

The abandonment of the Trans-Pacific Partnership by the U.S. has overshadowed, but only for a time, the steady growth of Pacific regional institutions for economic cooperation. ASEAN expands in importance along with the members’ national economies and trade. Shifting away from multilateral trade negotiations does not change that reality.

Australia Prime Minister Bob Hawke proposed APEC (Asia Pacific Economic Cooperation) in 1989. The initiative was embraced enthusiastically by President George H.W. Bush and Secretary of State James Baker, as the Cold War with the Soviet Union was clearly ending.

In the Atlantic region, NATO and the European Union can trace their origins back to the late 1940s and early 1950s, respectively. By contrast, Asia lacks the same long-established framework of collaborative institutions.

Since 1980, United States trade with Asia overall has been greater than with Europe, and that differential continues to expand. The Pacific region encompasses a steadily growing share of the world’s economic product, investment and trade.

President Obama, in 2009, participated in an APEC summit in Singapore and thereafter continued to underscore Asia’s importance. This sustained emphasis by Washington helped to strengthen Asia’s regional organizations as global as well as Pacific partners.

This in turn facilitated efforts to mitigate the financial crisis and consequent recession, which was worldwide in scope but concentrated in the Atlantic region. Asia’s economic strength was crucial to the slow but steady financial recovery.

In the 1980s, the Reagan administration significantly restricted Japan’s auto exports to the United States. Japanese vehicle manufacturers responded by greatly expanding production investment in the U.S. In reality, automobiles and other vehicles today result from global design, manufacturing, and distribution processes. The image of a car made in any single country is a distortion.